OFFICE OF THE INSPECTOR GENERAL, AUDIT DIVISION
ANALYSIS AND SUMMARY OF ACTIONS NECESSARY
TO CLOSE THE REPORT

Recommendation Number:

Resolved. In order to close this recommendation, please provide us with a copy of
the policy and procedures bulletin which emphasizes the importance of maintaining the
accuracy of the obligation records in the FMIS. This bulletin should also require periodic
review of unliquidated obligations and accounts payable to identify accounts that are no
longer valid.

Resolved. In order to close this recommendation, please provide us with the
results of the detailed review of unliquidated obligations and accounts payable to
identify invalid accounts, which is expected to be completed by September 30, 1997.

Resolved. In order to close this recommendation, please provide the status of
implementing a new property management system and documentation that addresses the audit
report recommendation that management: (1) assign responsibilities for P&E management;
(2) develop a policy that addresses P&E accounting and control requirements; (3)
develop procedures to achieve P&E policy and control objectives; (4) assess
cost/benefits of upgrading PMS to correct system deficiencies; and (5) perform procedures
to maintain data reliability.

Resolved. In order to close this recommendation, please provide the results of
(1) the OBD/USMS-wide physical inventory that is expected to be completed by the end of
FY 1997; (2) the assignment of acquisition cost values to those assets that have a
current book value greater than $25,000; (3) the review of property to ensure significant
assets already recorded in PMS are properly recorded; and (4) the identification of
significant capital leases and leasehold improvements as well as purchased P&E. In
addition, please provide the results of (1) deleting property that cannot be located
during the physical inventory from PMS; and (2) adjusting the P&E balances recorded in
the general ledger to agree with corrected balances recorded in PMS.

Resolved. In order to close this recommendation, please provide documentation on
how user access to FMS is restricted to the functions needed by each user to perform
his/her job.

Resolved. In order to close this recommendation, please provide documentation
showing that proper segregation of duties relating to FMS transactions have occurred,
where feasible. Where this segregation of duties is not feasible, please provide the
status of performing routine audits of those offices in order to deter and detect fraud
and errors.

Resolved. In order to close this recommendation, please inform us when changes to
the security software control options have been made that require users to change their
passwords at least every 90 days and that automatically log users off of a terminal after
30 minutes of inactivity.

Resolved. In order to close this recommendation, please provide a copy of the
procedures which will ensure end of year accuracy for revenue recognition and receivables
for financial statement purposes. Revenue should be recorded when services are performed
and a liability should be recorded for funds received where services have not yet been
performed.

Resolved. In order to close this recommendation, please provide a copy of the
procedures which will ensure end of year accuracy for revenue recognition and receivables
for financial statement purposes. Fee revenue and a corresponding receivable should be
reported for amounts due at the end of each reporting period.

Resolved. In order to close this recommendation, please provide us with the
results of the evaluation of procedures and the implementation of necessary corrective
actions that will improve the reliability of accrual information for the COPS program.